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Subscribe to RSSFollowing in the controversial footsteps of Yahoo, Best Buy has announced it will end its work-from-home program for 4,000 corporate employees in an effort to spark more "innovation and creativity." NBC's Kevin Tibbles reports.
Struggling electronics retailer Best Buy, long known for a corporate culture that rewards employees for performance rather than office attendance, is following in Yahoo’s footsteps.
A week after Yahoo CEO Marissa Mayer banned working from home, Best Buy announced that it is ending its flexible workplace policies and will require its 4,000 or so headquarters staff to work a traditional 40-hour week at the office.
Best Buy spokesman Jeff Shelman said the decision is “totally about making sure we do everything we can to reinvigorate the company for all our stakeholders.”
The new policy applies to the electronics retailer’s headquarters in Richfield, Minn., and not to most of the company’s 160,000 employees – dubbed “blue shirt” sales associates -- who work in stores.
Shelman emphasized that the new policy doesn’t mean an end to all flexibility.
“If you have a sick kid or say, like today, there’s nine inches of snow on the ground, or you have to go to the dentist, you can have a conversation with your manager,” he said.
The move comes a week after Best Buy announced it would lay off 400 employees at its headquarters, which the company said would help save about $150 million. The electronics retailer also had some good news: On Friday, it posted promising fourth-quarter results, as revenue from U.S. stores open longer than 14 months rose 0.9 percent.
But the last year has been hard on Best Buy, during which it announced the closure of dozens of stores. In July, the company announced it would lose 2,400 jobs; a company statement this week said there would be more layoffs this year. CEO Hubert Joly took the helm in August after former CEO Brian Dunn abruptly resigned in April 2012.
Best Buy had long-touted its unorthodox workplace, which began in 2005 with a program called Results Only Work Environment, or ROWE. Employees were evaluated on performance alone and were not beholden to a schedule or to the office.
Jody Thompson, a former Best Buy employee who implemented the program there, said that when she left the company in 2007, about 80 percent of the corporate office – between 2,500 and 3,000 employees – had been trained in ROWE. She said nearly all took advantage of the flexible schedule that came with a ROWE-focused work environment. Thompson left Best Buy to co-found Culture Rx with another Best Buy employee.
“It was going really well,” she said. “But over time, more and more happened in terms of new management coming in. There wasn’t the right thinking in place to continue to evolve, so they just decided go to back to 1952.”
Best Buy’s CEO doesn’t blame ROWE for its woes, Shelman said.
“There is no cause and effect that the struggles we’ve had as a company is directly tied to the flexible work schedule,” he said. “It’s just that this time and place the decision has been made that we want as many people as possible physically in position.”
After an investor presentation in November, Joly told the Star Tribune that he wanted employees to feel “disposable as opposed to indispensable.”
Key Banc analyst Brad Thomas has watched Best Buy for 12 years and said he’s not surprised by the company’s decision, noting that the new management team comes from outside the company. “This kind of policy would be the type of thing they’re trying to change about the company from top to bottom,” he said.
But he said even the smartest management team may not be able to save Best Buy in the long run. The practice of “showrooming,” in which customers visit a Best Buy store to check out an item like a TV and then buy it online for less, has cut into the company’s sales.
Despite the announcements by Yahoo and Best Buy, working from home appears to be growing rather than shrinking. The U.S. Census Bureau reports that 13.4 million people worked from home at least part-time during a typical week in 2010.
And research indicates that telecommuting doesn't hinder productivity. Washington State University psychology professor Tahira Probst said via email that research suggests that telecommuting also helps boss-worker relations.
"Telecommuting is associated with significantly higher levels of job satisfaction, lower turnover intentions, reduced role stress, and higher supervisor-ratings of job performance," Probst said.
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Ahh.. desperation at its finest...
Yea I don't think holding your employees hostage in an office for 40 hours a week increases productivity, but it may increase discussions that lead to new ideas. Unfortunately, I'm not sure they have the time or resources to save the ship from sinking.
The two BIGGEST LOSERS:
Yahoo
and
BestBuy
.
i dont know how the people running Best Buy can be so stupid. the soloution to the problem is staring them right in the face and they continue to ignore it.
"showrooming" the customer looks at a product in the store, then goes home and buys it online cheaper than the store is selling it for.
Best Buy seems to think that online-only retailers are not competition. if the online retailer can get the product into the customer's hands then they are definately a competitor. this is why their sales are tanking- the retail enviroment has changed and they refuse to adapt. the internet is never going away, things are never going to go back to the way they were. when times are hard economicaly that point is even more correct. people will not buy unless they know they are getting the best price, the customer doesnt care who they get the product from as long as its the lowest price out there.
Best Buy is going to have to bite the bullet and match prices with online retailers. and not through price matching at the register- customers do not like to do that, its a hassle. they need to have the best price listed on the shelf from the get go.
of course that will mean reduced margins, so Best Buy will have to run lean and mean as a company to make up for the reduced profit margin. get rid of redundant employees on the corporate level, cut down dramatically on the number of managers in each store, and take a machete to waste. employees overall will have to shoulder more responsibility and a greater work load per employee. they will have to close more stores in areas where they have over-saturated the market with locations.
Best Buy is going to have to see the writing on the wall and change with the times or they will go the way of the dinosaur.
I had the opportunity to read an employee manual for training sales staff in the bricks and mortar stores. Oh my God. They have no clue on what the customers of today expect. They do promote building relations. And I agree with that, But they also want the sales people to ask permission to take notes on everything that is talked about, and they also want the sales people to ask if the customer has pets, and if so, what kind and what are their names. I think they need to bring back drug testing. This is about as non nonsensical and antiquated as it gets.
jeff- i worked at best buy for almost 4 years, trust me, they drug test. the sales training manual you saw just shows how completely out of touch with reality upper management is.
Oh yeah. That's the way to get the most from your employees.
Hey moron: Employees who feel disposable result in customers who feel unappreciated. Customers who feel unappreciated result in customers who go to Amazon, where they clearly ARE appreciated.
And get rid of Geek Squad, whom EVERYONE despises.
No wait. You're on the right track. Full throttle ahead. Any company this stupid deserves a train wreck.
So, 400 jobs are being cut, and they expect to save $150 million. Um, that equals $375,000 per worker cut. Considering I wouldn't think they have that many high-paid employees, I wonder how many upper-management employees are being cut, and how much they made, so that Best Buy was losing money because of them.
If they are saving $150 million by firing 400 employees, they really have a problem anyway. That's a $375,000 average per employee! No wonder they are having difficulties! Sounds like it's top heavy to me.
You forget things like health insurance which are added cost above pay, also software licenses, and a place to work. $00 fewer people could mean one less building, or ending a lease on a few floors in a building
Not to mention the matching FICA that they will not have to pay. That would amount to over $450K if those people were only making minimum wage. The savings are not just in wages.
And pensions... They are looking at projected savings, not immediate.
Not to mention the $10 million/yr compensation package just for the CEO. If they reduced all corperate management pay by 30%, and let go the ones that don't want to work for something “that low” and then turn around and offer new, but experienced, college grads 500K/yr to take their place, just think where their profits would be. The new talent would probably be just as good, if not better than the overpaid executives. The same is true for most large corperations - in my humble opinion.
better service and prices would lead to more customers but i guess this will be the road not taken. and another one bites the dust
They can't really offer better pricing without losing money in the process. It's long been noted that people window shop in stores like best buy then go home and order the product online. They'd be better off to carry minimal inventory, and let you order the product online at the store and have it delivered to your house. Since most online retailers don't have to pay sales tax, as it's legally the consumer's job to do, brick and mortar stores like best buy get shafted on pricing. Bottom line, it's just more expensive to sell products in a store than online.
There's something about the luxury of working from home, in your pajamas at 3 in the afternoon. This will be missed by many. Me, well I just keep them on until the mood strikes. If anybody says anything I remind them of the Heff.
The company is struggling and they decided to make 4000 of their employees lives more difficult at the same time in a the tough economy.
They can kiss some of their remaining best people good bye because they just screwed them. The most skill people that can find a new job.
Unfortunately for them there are thousands willing to take their job. Just speaking the truth. Employers have the advantage. Stinks.
What do you expect from a CEO who wants his employees to know they are "disposable"?
So true of so many companies in 21st century America. The businesses have no real relationship with their employees as once existed. Employees are not stupid, they know when they are considered disposable (management at my last job didn't mince words letting employees know if you didn't like something, then hit the road. It would be easy to replace you. And this was a major auto insurance company with a cute little green mascot).
two poorly run businesses and their poorly conceived business models...so who is surprised?
I visited a store a few months ago. It had been many years since I stepped inside the same store. I was appalled with the overall experience: Sloppy end caps, merch in disarray, low or no merch on the shelves, overall feeling of a "dirty store," customer service was a joke.
That store developed a Walmart mentality.
Show me someone who says they work better from home and I'll show you a liar.
You are seriously flawed. My staff had flexibility to work from home generally. One guy lived two hours away and worked from home four days a week. He was available any time of the day to solve problems. We were an IT group supporting an international company. Night time upgrades, anytime problem solving. It worked. Companies like Best Buy are just looking for someone else to blame for their not making money.
Frank,
I work from home full time and I find that I work 50 to 60 hours a week. Much more than I would work in an office. You want to call me a Liar?
Studies have shown that telecommuters actually work more hours than traditional workers.
Pay-for-production is the most cost-effective way to go.
I worked from home for seven years and the ability to tune out interruptions or pull an all-nighter to get something done was wonderful.
The only job I had that was more productive was the one where you got shipped out to a client site and squirreled away in a hotel with no family or friends to intrude.
Working from home is not for everyone. Those who only work because they are being paid to are the worse. One minion of mine wanted to work from home and admitted he wouldn't put in more than fours hours (which I immediately figured he meant only two) if he did. Some people seem to need a gun to their heads (or a manager standing over them) before they will do any work.
Telecommuting is a farce. You come to work. You engage in conscious exchanges with your associates. You produce. Not work from home so you can do the laundry, smoke weed, watch television, sneak off for a quickie. Maybe if you are working for yourself, but not for a Corporation. Probably why Yahoo stock has dragged along and Bestbuy is in the toilet. About time these high priced EXECS used their heads.
There are some jobs that are better performed at home, if the worker is qualified to do it without "adult supervision".
You ever needed to code a large system with a short deadline? You save an hour commute each way, and tend to work to a good stopping point, and not by the clock.
You either are a contributor or you are not. It really does not matter who s watching over your shoulder.
Seriously, it all depends on the job. For instance, at my last job we had an internet department where people serviced customer accounts online. They did not have to sit on the phone, just in front of a computer. They had no real input with management as to how the business was run (and neither did those of us on the phone lines in the call centers who sat in the office). I knew a few people who did work from home. It was an ideal job for working from home. The only problems I see are with lazy managers that don't want to plan meetings ahead of time but to call them at the last minute. Those working from home need a little headway and most have no problem coming into the office for these if they have advance notice. The biggest negative I can see is that working from home is not a good fit for people that want to climb in the company. They need to be in the office and be seen and heard by management.
Hey, The Lazaro: That might be how YOU work at home, but I actually take pride in my work. And I've always found I get more done when I'm in my jammies on my computer at home. No interruptions to "surprise" someone with a birthday cake in the break room or look at somebody's vacation photos or just nod while someone who doesn't want to work blathers on about American Idol.Yes, I said it, the real slackers are at the office.
I suspect more companies will now follow Yahoo's lead. In my opinion, it's about employers viewing their staff as children who can't be trusted to do their work without constant supervision. As a great, anti-authoritarian friend used to say, "The Man doesn't just want you to do the job, he wants to control the look on your face."
Daisy, same here. Physically driving into the office was 2.5 hours a day wasted, not to mention the cost in gas, car maintenance, buying lunch, new clothes every couple months, etc.
Lazaro, not everyone has your work ethic. Can we assume you speak from experience? Note the posts of those who work from home. They generally work harder and put in more time than those who clock in at the office. Such an immature response you made.
Not true. I'm about twice as productive at home as at the office. I don't have people stopping by, calling meetings, inviting me out to lunch and all of the other myriad disruptions you have in an office. If I really need to focus and get things done I do it from home where I can more or less work undisturbed. I've found people are a lot more hesitant to interrupt you if you're at home than they are in office.
That said I've worked in some pretty odd places like having a teleconference in a car going up the 28 in California or a fishing boat bobbing along in the Atlantic--both because I was supposed to be on vacation, but got a call.
Agreed, mj, Frank and Lazaro are from another time and place. Sure there are reasons for getting everyone together at times, but for crunching through a task give me time at home, preferably starting at 4-5:00 am with no distractions. I'll have way more done by noon than the fellow who commutes to work with zillions of other people gets done by five, and he/she still has to stress out getting back home.
I prefer to work 8pm to 6am, no shows on TV to distract and no one calling you in the middle of the night, just pure "flow" time.
I noticed that they didn't apply the policy to their American Worker replacements in India. Since they outsourced their American IT jobs, I haven't bought there. I hope they go down the tubes.
Considering the quality of the people working in Best Buy stores, they should ALL work from home.
All or nothing thinking. This is one of the reasons why Best Buy and Yahoo are failing, and as the economy improves they'll only be able to attract the most desperate of employees (certainly not the best).
Most corporate offices are not designed for innovation and creativity... trash the cubicles and create an open office with mobility.. use tablets instead of PCs, etc...
When I actually went in to the office I always like having a cubicle. I've never liked having a wide-open workspace, it's just downright creepy. Since everyone used laptops it was not a big deal to get a group together in a common space for discussions. Sometimes I miss it, but saving over $200 in gas a week I can get by without the real-world commute. :D
I worked in a virtual position for 2 years for a very large company and I guess I have mixed feelings. It was nice to save time and money on the commute. I do feel like I was more productive because I could focus in on things more closely without distractions. It took a short period to adjust to the new environment. I respected the trust my company placed in me to work from home so I minimized anything that could be a distraction and treated my home office in mind like the regular office. You need to be focused on work and get results. I just don't think this environment is right for everyone. And I guess that's the question- how do you tell who it's right for or not? I guess if you don't see results then there is a problem but I think some people do get away with a lot when working from home. I had two employees of mine also working from home and it was difficult to see exactly what they were doing. I had to trust in certain things that they were getting things done. I had to trust that they could focus on the right things. I couldn't see how hard they were actually working and how much extra time they really had open to ask them to do more. I could do that in an office. I think office networking can be important for career advancement. I wonder how much that suffers from being virtual. I criticized Yahoo's decision to stop allowing people to go virtual but I saw that the CEO pulled the VPN records to see if people were logging in and they were not. So I do support her decision to do what she needed to do. People were disrespecting the trust placed in them and collectively they were caught. I was logged in from 8-5 at minimum- I would have expected someone to call me out if I had not been. Yahoo people got called out and had their privileges taken away. I think it's worth at least looking at the current system and seeing how things can be improved. Telling workers they are being looked at from a system login perspective. Asking them to justify their time? Having periodic team meetings at a physical location? (something my company did).
Wow, the company I worked for knew exactly how much work you were accomplishing. Every piece of work was stamped with your unique ID. There was a long electronic trail of what you'd done, every account you'd handled. Your computer at home was connected with the servers in the office. It was as easy to tell what the telecommuter did as the person in the office did. They could have easily cut out half of the managers they had since the computers could keep up with peoples' productivity better than the managers could!
These companies will struggle, if not fail, regardless. In the case of Best Buy, any company that encourages its employees to feel "disposable" will never get innovation, which requires a free and safe environment where risk and failure are tolerated. You can't come up with new ideas if you're afraid to take a chance. Moreover, top down management is no way to get cooperation or collaboration. Finally, companies that choose to ignore solid research supporting the value of telecommuting to go instead with some "feeling" that putting everyone in the same space will somehow spawn new ideas is not likely to succeed. The best employees in the right environment don't need to be forced to contribute and innovate. Besides, as others have noted, the best employees will be leaving these companies anyway. The problem with both these companies is too many overpaid executives. (Oh, and as a consumer, I won't support such companies. The hell with them and their autocratic crap.)
You're right on all counts. Yahoo! can forget about innovation now, except for innovation in finding a job someplace else, someplace possibly a little more secure. The people who work there aren't going to forget this or think about anything else knowing they could be next.
Not surprising since both of these companies are the worst in their respective industries.
Ahh yes, telecommuting.
Why whould these dinosaurs want to leave the twentieth century behind?
Totally bad idea. Instead of banning the WFh policy, why don't they go after those who aren't actually producing, like the managers and and any slacking employee? There is no need for mid-level managers if you have employees who are disciplined to do their work wo being micromanaged. Plus, you're spending money on office space to house these employees. That adds up! Someone evidently has trouble with math. Oh, and cut the salaries of upper management. Those people are ALWAYS way overpaid since the worker bees are the ones doing the actual work.
Tell me about it. At one time I had five managers, and then they decided to lay off ALL of the workers! When work stopped and our customers asked why and found out they were firing everyone who wasn't in a management position, those customers went ape-sh!t. It was a real debacle. Needless to say, every one of those workers was reinstated. Sounds like Yahoo! and BB are on the same track, but I wouldn't blame any of those workers if they took one of the MANY job offers now being made in the industry to absorb those cut loose from Yahoos! idiocy.
If Yahoo! and BB are doing this to "increase collaboration and creativity" I have some bad news - once people know their job can end at the whim of a poor executive decision at any time, that's all they think about...until they find a jobs somewhere else.
If Best Buy has an open position - why would the most talented candidate go to there instead of another large co in the industry? Its just lost a point of leverage with it best employees and in attracting new ones.
Now it have two strikes against them, a less than stellar reputation and inflexible work environment. So it will have to make up for that with higher wages. To attract and retain quality people, who will jump ship anyway when they get a higher offer? So now there are costs associated with turnover. So where is the cost savings?
Best Buy should have been more vigilant about identifying and weeding out poor performers who were taking advantage of its flexible work environment than banning it outright. They have created a bigger mess now because the good people will leave (they can get a new job) while the less stellar performers may hang on with fewer options, leaving best buy with a weaker employee pool than it had before.
antiquated Dinosaurs run by barbie doll wanna be macho businessman
Folks, between yahoo and best buy, I'm not sure that EITHER is a good example for american companies to follow.
There a lot of young people with minimum to moderate technical skill sets at these companies. marissa mayer is jewsih which means that for the most part the gentile workers don't really matter.
BTW, She herself got the benefit of remotely working when raising her kids so this is HYPOCRISY at its best.
She should stick to modeling and let the big boys run companies. Last I looked, yahoo wasn't the sharpest tack around. GOOGLE is. AND EVERYBODY works from anywhere they want at google.
Best buy will probably run out of business whn the touchy feely buyer becomes extinc. I mean hey, a panasonic cordless phone isn't a critical must touch before I buy. I'll just google the best price and but the frikking thing on amazon. THAT eventually = no more best buy
antiquated Dinosaurs run by barbie doll wanna be macho businessman! Laughable!
"Best Buy announced it would lay off 400 employees at its headquarters, which the company said would help save about $150 million."
Let me see, a savings of $150 million, divided by 400 laid off employees, that equals, uh, a savings of $375,000 per person. Either they are laying off a lot of high-level executives or else some well-paid employees with tremendous benefits plans! Something sounds a little fishy with these numbers, or else Best Buy's management doesn't think people can do long division!
Gosh, millions of us stopped purchasing from Best Buy years and years ago. Greed prices stood out the most. Alas, another public traded company headed for disaster. Better rethink executive pay, America is getting fed up.
I guess Yahoo! leads the new way for a struggling company to fire thousands of workers. Just what the economy need right now, more unemployment.
Hey Yahoo! and BB, how about firing some of your overpaid executives? That would save you much more money.